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In 1890, the shah signed a contract with a British man, giving him ownership of the Iranian tobacco industry. The contract was later canceled. Russian goods at low tariffs (thereby undercutting the ability of Iranian manufacturers and farmers to compete) in exchange for loans to pay off the shah’s debts. At the same time, the shah gave a British citizen the rights to almost all of Iran’s oil fields. The money received for these “sweetheart deals” did little to 51 52 ali khamenei lower Iran’s debt, especially since the shah and his Qajar regime continued to spend lavishly and live far beyond their means.

As a result, the British government acquired a controlling share in the Anglo-Persian Oil Company (APOC), the monopoly that controlled Iranian oil fields. In order to head off Russian competition for this oil-rich Iranian territory, Britain granted Russia control of Istanbul and the Turkish Strait. Iran was to remain technically “neutral” throughout the war, but controlled by Britain. Yet as the war drew to a close, the country was subject to the intrusive presence of British, Russian, Turkish, and tribal military forces.

He invited Shiite clerics from Lebanon to come and take over Sunni mosques, and public rallies in which Sunni Islam was violently cursed were held. Having established his empire and restored Persian pride and identity, Ismail faded away in surprising fashion. After suffering a relatively minor defeat in battle against the Ottomans in 1514, Ismail seemed to go into mourning and surrendered to drunkenness and idle living. He died at the age of 36. Shah Abbas I The Safavid dynasty remained strong, however, especially under the leadership of Shah Abbas I, the Safavids’ greatest leader, who was born in Afghanistan and whose rule was centered in Khorasan, Ali Khamenei’s home province.